THE CHANGING RULES OF THE GAME Four external events have created the new business dynamic that all companies and their employees must come to terms with today:
These fundamental changes have all occurred in the last 25-30 years. They are the defining events of the post-Industrial age, and together they have turned a once predictable landscape into a place where constant instability is the only "certainty" that can be relied upon. 1. Globalization Prior to World War II, the number of American firms involved in foreign investment was relatively small. Even after the war, most United States business activity remained centered on its domestic markets -- markets which continued to provided adequate scope for growth and a natural competitive monopoly. Foreign imports were insignificant through the 1950s, and the products America exported were the same products it sold at home; shipped abroad without alteration or sensitivity to cultural differences. Today, America has become a front-line player in the global arena; a major force in multi-national production, world-wide distribution and global strategic alliance. In an age where daily foreign exchange volume is $1.3 trillion and U.S. corporations are directly investing more than $100 billion a year in international markets, the majority of the America's largest companies now conduct more of their business activities abroad than they do at home. American exports have increased more than ten times in the last two decades, and of the 1000 largest industrial corporations in the U.S., 700 expect their international growth to exceed their domestic growth in the next five years. Remember, however, that globalization is an executive-led phenomenon. The work force played no direct role in its development, and most employees will have little understanding of its dynamics. Because this lack of understanding can lead to confusion and even a collapse of commitment, it is the leader's job to make sure that people throughout the organization are fully informed about the company's global future and about how each fits personally into to that future. Here are some management strategies to help you accomplish that aim:
2. The Technological Revolution Advances in technology drive change throughout organizations, enabling them to improve their business processes by replacing routine activities with information systems and robotics. Instant electronic transmission makes it possible to move data to any location on the globe. Advances in electronic networking are redistributing power in organizations, making it feasible for employees to skip levels in the chain of command, providing senior executives with direct access to employee feedback on performance and organizational issues, and making workers at remote sites feel that they are part of the team. Estimates are that a billion people worldwide will have Internet access by the year 2000. Intranets are becoming the pathways to the intelligence of the organization. Technology is providing employees with direct access to information necessary for business decisions. This transfer of knowledge directly to workers has made possible --and inevitable -- many of the changes in the organizational structure of the corporation, and has been one of the major forces behind increasing employee empowerment. Technological progress is inevitable, but new technology inevitably displaces workers. The most important thing to employees who no longer dig ditches by hand or take orders by telephone is to know that they can learn the skills needed to survive in this changing business world. It's only human nature that employees will resist implementing technological change until they are shown how the technology enables them to do their jobs better, faster, more easily --and how cross-training for new high-tech functions can mean brighter, more secure futures for themselves and their families. 3. Customer Power Consumers around the globe are relentless in their demands for quality, service, customization, convenience, speed and competitive pricing. And with global competition and the new technologies providing customers ever greater choice about when, how, and where they will receive goods and services, they have, in effect, become the determining factor in the success or failure of most companies. We are selling products and services to an increasingly informed and sophisticated consumer today; a consumer no longer prepared to pay inflated prices for less than ideal goods because of their brand names or because no equivalent product is available. Today there is always an equivalent product available somewhere in the world -- and a customer ready to defect to the opposition if your version doesn't come up to their standards. As a manager, you promote the critical employee/customer relationship when you:
4. The New Service-dominated Economics Based on the latest Gross Domestic Product figures, service industries of one kind or another now predominate over manufacturing in the United States by four-to-one. More than eight our of ten American workers are employed somewhere in the service/information sector today. And Customer Service, one considered a retailing side-issue, has now become a key factor in the marketing strategies of all survival-minded companies, the same is true abroad -- so much so, in fact, that the International Monetary Fund has dropped the label "industrial countries" when referring to the world's developed nations, replacing it with the now more accurate term "advanced economies." According to the Fortune article "How We Will Work in the Year 2000," the main mind-set shift for companies will be a move from "thinking of business as making things to realizing that it consists instead of furnishing services, even within what has been traditionally been thought of as manufacturing. Much of the quality movement can be understood as building more service into a product. When an Eastman Kodak or Allied-Signal breaks down its operations into the steps by which it adds value, the company is really identifying the series of services performed that eventually lead to greater customer satisfaction." With this shift has come a whole new list of priorities and challenges in the management and training of a work force:
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